In China’s rapidly evolving fashion landscape, the online-to-offline (O2O) strategy has emerged as a powerful tool for fashion brands to thrive. By seamlessly blending the digital and physical realms, fashion brands can create a holistic customer experience that resonates with tech-savvy Chinese consumers.
Through personalized digital touchpoints and immersive physical stores, the O2O strategy enables brands to attract, engage, and convert customers, fostering brand loyalty and driving business growth in China’s dynamic fashion market.
In this blog post, we will explain to you how online-to-offline commerce works in China, what are its benefits, and challenges, and how can you use this strategy to attract Chinese consumers and increase sales.
What is the online-to-offline (O2O) strategy?
O2O, or Online-to-Offline commerce, is a thriving business model in China that seamlessly integrates online and offline channels to enhance the shopping experience for consumers. It involves attracting potential customers through online platforms like websites, mobile apps, social media, and online marketplaces. Customers can explore products, make reservations, or place orders online.
However, the final step of the transaction occurs offline, typically at physical stores or designated locations. Customers visit these establishments to try out products, receive personalized assistance, make payments, or collect their orders.
O2O commerce effectively bridges the gap between the digital and physical realms, combining the convenience of online shopping with the sensory aspects of traditional brick-and-mortar retail.
China’s O2O market has witnessed remarkable growth in recent years. In 2021 alone, the online-to-offline delivery market in China surpassed 3.3 trillion yuan, with home delivery services contributing approximately 2.1 trillion yuan to this figure. Industries such as retail, food and beverage, beauty and wellness, and entertainment prominently embrace the O2O business model in China.
Benefits of the O2O Model
O2O commerce offers convenience to consumers in China by allowing them to browse and shop online at their convenience and then complete their transactions offline. It saves them time and effort by combining the ease of online shopping with the immediacy of offline fulfillment.
Physical stores provide a tangible and sensory experience that online shopping alone cannot replicate. Customers can see, touch, and try out products, receive personalized assistance from the sales staff, and make informed decisions based on their in-store experiences.
Trust and Security
Some consumers prefer to see and verify products or services before making a purchase. The O2O model provides a sense of trust and security by allowing customers to physically inspect and test products or interact with service providers.
O2O marketing provides opportunities for personalized interactions with customers. By collecting data from online interactions, businesses can offer personalized recommendations, promotions, and services both online and offline, enhancing the customer experience.
The O2O model enables businesses to create a seamless integration between online and offline channels. Customers can start their shopping journey online but have the flexibility to complete the transaction offline or vice versa. This omnichannel approach enhances customer engagement and satisfaction.
Popular O2O Categories in China
The Click-and-collect operation
This one is the easiest. A customer looks for a product online, buys it, and then stops by the brand shop to pick up the items. New Look, the English fast fashion company allows its customers to buy products online and pick them up in the shop with even a QR code. Thanks to this operation, they saw their turnover increase.
The brand is also on all parts trying to make shopping easier for its customers; whether it’s mobile shopping, the easiest check out at the desktop, the development of next-day delivery, and so on…
Use WeChat as the best digital tool for O2O marketing strategy in China
WeChat enables brands in and near their physical stores to communicate with customers. Brands can send push notifications with promotional content or news specifically geared toward this customer. If he received it maybe he will stop by the shop.
Louis Vuitton already developed this kind of operation and sent messages to customers where they were close to one of their boutiques.
Other digital tools you can use to build your O2O strategy in China
Retailers can provide in shops some tablets and digital screens. This allows the retailer to show all of the inventory and push the clients to subscribe to its WeChat and/or Weibo accounts.
Shops can use smart fitting rooms that will let customers see themselves in a lot of different clothes. It can also increase additional sales by proposing different products. Some of these fitting rooms allow shoppers to send and share pictures with their friends. It’s one of the best innovations we’ve seen for fashion brands this latest year.
What other O2O operations fashion brands can do to increase the shopping experience?
A fashion brand must also allow its customers to pay via applications like WeChat within shops. Social media is the best “raw material” for the shopping experience in China. WeChat is one of the pillars of this tendency but you have to use all the features of the app to be efficient.
China is now in the era of Internet thinking, and the Internet has become the mainstream media that has changed the media landscape and the way Chinese customers buy and inform themselves. For them, it’s normal to pay using an app within a store. Fashion brands must understand it and adapt their strategy in this way.
Offline to Online vs. Online to Offline
To generate some sales, the O2O operations must occur from the retail store to have an impact on online sales. It’s going to be way much easier than leveraging your TMall or JD.com e-commerce online shop to increase the shop’s turnover.
When customers do physical shopping, they will always look at reviews and promotions online to purchase the best offer they can find for the item they want. It’s an offline-to-online strategy.
Some Chinese customers don’t have time to do shopping in physical stores and prefer to shop only online, but luxury consumers are seeking real shopping and the customer experience in physical boutiques. Here the strategy is online to offline; customers want to be sure of the product they want before coming into the store.
Find an agency to develop your O2O strategy in China
While online shopping continues to rise in popularity among Chinese consumers, retail is far from dead. It’s time for brands to rethink their approach and consider the power of online-to-offline (O2O) or offline-to-online strategies. These strategies are proven to drive traffic to physical stores and cultivate a loyal social media following.
If you’re seeking to bolster your social media presence or execute impactful O2O campaigns to attract more customers to your stores, our agency is here to help! We specialize in digital marketing and have a deep passion for China and its vibrant culture. We are committed to ensuring your success in China with a tailor-made strategy that perfectly aligns with your brand.
With an extensive portfolio of luxury and fashion brands as our valued clients and partners, we invite you to explore our compelling case studies. They serve as a testament to our expertise and success in delivering exceptional results. Don’t hesitate to reach out to us today to discuss your unique project in China. Together, we’ll pave the way for your triumph!